Whether you are buying your first car or you are looking for a new model as an upgrade on your existing one, it can take a lot of money to obtain the vehicle of your dreams. Not everyone is lucky enough to have the money readily available for them to buy a car straight away. In fact, great numbers of people will need to take out a loan in order to finance their car.
Unfortunately, there are many reasons why you may not be eligible for finance to help you afford a car. Here are some examples of why you might be rejected for this type of car loan.
- You have a poor credit rating
One of the main reasons why you may get rejected for a car finance deal is poor credit. When you try to buy an expensive item on finance, your bank or lender will need to take a look at your credit rating to see if you are worth the risk. If you are deemed as a bigger risk, it’s very likely that you will be rejected for a loan, or you may be offered a loan with a higher interest rate.
Your credit rating can be lowered if you have additional debts, missed payments or loans that you need to pay back. However, the opposite can also apply. If you have no debts, and you do not have enough evidence to show that you are trustworthy enough to pay back your loan, you may not even receive a credit rating. This would mean you cannot generate a score that shows you can pay back what you owe. As a result, you could be rejected for car finance.
- Age & youth
Although this may make you feel as if you are being discriminated against, unfortunately, lenders do tend to favour older drivers when it comes to taking out financial loans.
Finance agreements can only be taken out by people who are over the age of 18. However, if you fall between 18-21, there’s a chance that your age may be a deciding factor about whether or not you will be offered a loan.
Don’t be too downhearted about this type of rejection. There will almost certainly be other lenders who would be willing to provide you with a loan.
When you go to each lender, you may find that they have wide-ranging criteria you need to fulfil in order to achieve the loan.
Essentially, the lender needs to make sure you are not a liability when it comes to paying back your debts. Therefore, if you do not have a job, are self-employed or have just started a brand-new job, you may find that your application for a loan is rejected.
The lender is going to look at your financial history before they decide whether or not they will accept your loan request. This will include your wage and outgoings. If they deem that you cannot pay back your loan, or you do not have enough money to do so, you may be rejected.
Are you ready to discover just how good a car finance deal you could obtain with our help? If so, simply apply today; we can give you a free no-obligation quote, drawing upon our panel of lenders, so that you can be surer about your options for a car loan.